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City Research Online City Research Online City, University of London Institutional Repository Citation: Aversa, P. ORCID: 0000-0003-3175-9477, Schreiter, K. and Guerrini, F. (2021). The birth of a business icon through cultural branding: Ferrari and the Prancing Horse, 1923 - 1947. Enterprise and Society: the international journal of business and history, pp. 1-31. doi: 10.1017/eso.2021.22 This is the accepted version of the paper. This version of the publication may differ from the final published version. Permanent repository link: https://openaccess.city.ac.uk/id/eprint/25916/ Link to published version: https://doi.org/10.1017/eso.2021.22 Copyright: City Research Online aims to make research outputs of City, University of London available to a wider audience. Copyright and Moral Rights remain with the author(s) and/or copyright holders. URLs from City Research Online may be freely distributed and linked to. Reuse: Copies of full items can be used for personal research or study, educational, or not-for-profit purposes without prior permission or charge. Provided that the authors, title and full bibliographic details are credited, a hyperlink and/or URL is given for the original metadata page and the content is not changed in any way. City Research Online: http://openaccess.city.ac.uk/ [email protected] 1 The birth of a business icon through cultural branding: Ferrari and the Prancing Horse, 1923 - 1947 Paolo Aversa* Cass Business School, City, University of London Katrin Schreiter King’s College London Filippo Guerrini Cass Business School, City, University of London *Corresponding author: [email protected] [Forthcoming in Enterprise and Society] ABSTRACT This article examines the origin of the ‘Prancing Horse’ symbol, and its role in helping the racing team Ferrari survive under the Fascist regime in Italy. Enzo Ferrari, the company’s founder, adopted the coat of arms of Francesco Baracca, the most renowned Italian military aviator during World War I, as the logo of his new racing team. By repurposing it from military aviation to motorsport, he benefitted from powerful cultural associations and strong political and cultural endorsement towards Baracca’s persona. Drawing on scholarship on cultural branding and consumer culture, this study shows how new companies can establish powerful business icons by borrowing symbols connected to populist worlds and national ideologies, and transfer them to various industries. Strategic repurposing thus emerges as a distinct process within cultural branding to obtain institutional support and establish powerful brand identities in challenging contexts. Keywords: Cultural branding; Consumer Culture; Strategic repurposing; Icons; Ferrari; Prancing Horse; World War I; Francesco Baracca; Logo; Fascism; Motorsport. ACKNOWLEDGEMENTS We gratefully acknowledge the editor in chief Andrew Popp, the associate editor Shane Hamilton, and the two anonymous reviewers for their knowledgeable guidance in developing our manuscript. This work benefitted from insightful conversations with colleagues in the marketing and strategy groups at Cass Business School, among which we would like to mention Marius Luedicke and Gianni Lorenzoni for their expert suggestions. Finally, we would like to thank all the informants that provided their time and expertise, and in particular: Mauro Antonellini, Mauro Bianco, Luigi Candiani, Ada Fichera, Livio Lodi, and Daniele Serafini. We also acknowledge the support of the Center for Sport and Business at the Stockholm School of Economics. Errors are our own. 2 The birth of a business icon through cultural branding: Ferrari and the Prancing Horse, 1923 - 1947 Ferrari currently ranks as the most powerful brand in the world.1 Its iconic logo, the “Prancing Horse” on a yellow background is univocally associated with Ferrari, and elicits a quasi-religious devotion among its fans, who are known as “tifosi.”2 Enzo Ferrari (1898–1988) and his legacy progressively built the company’s reputation on narratives of racing success obtained by its cars and drivers that have cemented its leadership in the motorsport and luxury road car businesses.3 Yet, few recall the military origins of the Ferrari logo, which can be traced back to the Italian military aviator Francesco Baracca, a “forgotten hero of the Great War.”4 Although they were contemporaries from the same region, Enzo Ferrari and Francesco Baracca never met in person. When the picture below (Figure 1) was taken on 1 May 1917, Enzo Ferrari, the later founder of the namesake car company, was an unknown 19-year-old blacksmith serving in the 3rd Mountain Artillery Regiment of the Italian Army. [Insert Figure 1 about here] It was not until 1923 that Ferrari, at the beginning of his racing career, had the opportunity to adopt the Prancing Horse, at the time a symbol of national renown, for his race cars, and to use it as his company logo from 1939 onward. A number of historical accounts report the events through which Ferrari obtained Baracca’s coat of arms.5 However, no systematic exploration has been conducted on the business rationale and potential motivations underlying this process within cultural branding , and, in particular, the specific factors enabling the successful strategic repurposing of this symbol from aviation to motorsport in support of Ferrari’s newly established venture. To understand the significance of the logo in Italy’s interwar society and to trace how Ferrari used it to gain a competitive advantage, this article draws on 3 cultural branding literature, specifically Douglas Holt’s concepts for studying iconic brands, together with insights from anthropological work by Grant McCracken that established how the meaning that culture supplies to the world can be transferred onto consumer goods.6 More often than not, iconic brands7 emerge through different and idiosyncratic myths and stories, some of which are strongly contingent on the contexts where the brands were first rooted.8 How to establish this context is of utmost importance because “if brands exist as cultural, ideological, and sociological objects, then understanding brands requires tools developed to understand culture, ideology, and society.”9 Yet, scholars argue that we are still far from unpicking the nuanced, multifaceted interface between brands and society.10 Here historical methods of contextualizing the brand within socio-political processes and events can deliver such a tool. They allow us to see how redeploying an iconic and meaningful symbol from a cultural context or historical period to a business may ultimately establish and reinforce a brand’s unique identity based on broader, shared cultural categories. This redeployment can achieve differentiation and competitive advantage in fierce markets, valuable for newcomers which often have to compete with inferior resources against established incumbents. 11 However, this process can present different forms depending on the industry and context where it takes place. For example, while most literature has investigated advertising campaigns to explain how this process happens for consumer goods (e.g., fashion, sport equipment, soft drinks, spirits, design furniture, automobiles), we have little understanding of other business settings (e.g., industrial goods, sport industries) or other cases where advertising it not adopted as a tool. Our study focuses on the transfer of a symbol from a cultural context to a business setting in the form of a logo, thus aiming to explore the underpinnings of this specific, important, and yet understudied process within cultural branding.12 Our study argues the success of this 4 operation is due to a process we term strategic repurposing—which can be conscious or incidental. The process starts with the transfer of meaning and values from the original to the new context and eventually can lead to the replacement of such elements with the firm’s own narratives. This may also help the firm to dissolve prior cultural associations with meanings which have become undesirable. The case of Ferrari in its early years, where the emergence of the cultural icon predates the company foundation, is an ideal setting to explore this process through a novel perspective. While most studies to date have explored the processes of cultural branding aimed at targeting consumers and users, we focus on a phenomenon where the company’s actions instead obtained the institutional support of critical non-market stakeholders (i.e., political and cultural elites) at a time when Ferrari was not selling road cars. Our analysis thus makes a contribution by looking at political context that produces cultural categories and principles to show how a transfer of meaning and values from the socially constructed world to a brand can be fundamental in securing institutional support for a firm, especially in economic systems with higher levels of state intervention.13 In turn, the change in culture after the end of the fascist regime also explains why, in the postwar era, Ferrari downplayed the ties between his brand and the meaning originally associated with the logo. This might be the reason why today few recall the connection of the Prancing Horse with the WWI fighter pilot. The source base of this study revolves around two main aspects. First, the life and mythologizing of Francesco Baracca and, second, Enzo Ferrari’s adoption of Baracca’s coat of arms and the business effects of this operation. The former aspect is explored with the help of published war histories and archival documents retrieved from the
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